Health trusts face ‘serious financial difficulties’

Two West health trusts are facing ‘serious financial difficulties’ as the fall-out from London hospitals that have ‘gone bust’ hit the region.

But the Great Western Ambulance Service and Weston Area Health Trust hit back last night at being named by Government sources as being in danger of following the South London Healthcare Trust into administration.

The London trust runs three hospitals in south London, two of which were built by expensive PFI deals, and administrators have been called in after ministers effectively declared it bankrupt.

Yesterday, Health Secretary Andrew Lansley repeated his view that the NHS would not keep bailing out the debts of troubled NHS trusts and warned that at least 20 others were in financial difficulties.

The GWAS trust, which covers Gloucestershire, Wiltshire and what was Avon, and Weston Area trust, which runs Weston General Hospital, were named on that list – something GWAS chairman Peter Carr said was unfair.

The ambulance service was named in a report by the National Audit Office last October as being one of a number of NHS trusts that would be too small, or ‘unsustainable’ to evolve into foundation trusts in their own right.

That reinforced a move two months earlier for GWAS to seek to merge with the South West Ambulance Service, which covers the rest of the West Country, which should be completed by January.

A GWAS source said while the list of 20 ‘trusts in serious financial difficulties’ might include hospitals with a huge level of PFI debt, it wasn’t in financial trouble.

The finance chief at the West’s biggest PFI hospital – the Great Western Hospital in Swindon – also sought to reassure patients it could handle the debt burden of the hospital build, unlike the PFI deals on the two London hospitals.

“Like every trust in the NHS the financial environment is very challenging, all trusts are having to do more with less,” said Maria Moore, GWH’s director of finance and performance.

Weston Area Health Trust also strongly denied it was in ‘serious’ financial trouble, but bosses yesterday admitted it may have to merge with other bodies to survive the Government’s reforms.

Late last year, the trust admitted it was £834,000 behind on its plans to make the £6million a year savings demanded by the Government, with managers warning failure to deliver the savings could put the financial plans in jeopardy.

Comments

Exactly, PFI is not shown as a liability and does not form part of the borrowing requirement. In opposition George Osborne critcised the scheme opting for a modified version involving passing more of the risk to the private sector via part privatisation, but in his first year in office he has approved 61 projects with a total value of £6.1 bns. In total, as at December 2010 the total value of PFI contracts payment obligations was £267bns.

PFI's been a disaster, and not only in the NHS. Both Labour and the Tories are responsible (it was introduced by John Major's government in 1992) but the Treasury loves it because it keeps debts off the books while ideologues love it because it fits in with their 'public bad, private good' mantra.

Both of these trusts are going bust because of the weight of outrageous debts due to the last Government's PFI mismanagement. The health budget has gone up. they are not being starved of funding from central Government.

Well it's all going to plan isn't it Lansley?
Starve them of funds then privatise. Goodbye NHS. This is by far the worst thing the Tories have done and there's an awful lot to choose from. (Thanks Don)!